Sales tax and import sales tax when exporting to Switzerland

value added tax

By means of a declaration of subjection abroad , online retailers can voluntarily subject themselves to tax liability and register in Switzerland’s VAT register before the Swiss delivery threshold, which is decisive for mandatory tax liability, is reached. Or by reaching the Swiss delivery threshold, VAT registration in Switzerland is legally binding.

Whether required by law or voluntary. From the time of being subject to VAT in Switzerland, Swiss customers , both B2C and B2B, are entitled to Swiss VAT of currently 7.7% at the standard rate and 2.5% at the reduced rate.

Sales tax practice

It is recommended that you keep a separate account with the appropriate tax code for the Swiss sales tax incurred in your company from the sale of goods.

import sales tax

The import of items from a third country (not CH or FL) into Switzerland is subject to taxation and customs clearance . However, the import tax does not have to be calculated by the entrepreneur himself and declared in his VAT statement, but is levied together with the customs duties , if they arise, by the federal customs administration .

The standard tax rate is currently 7.7%, the same as for domestic purchases. Certain everyday items (e.g. food) are subject to the reduced rate of currently 2.5%.

The aim of the import tax is to tax domestic consumption . Therefore, the country of destination principle applies. The items are exempt from local taxes because they are exported from the country of origin. In return, they are subject to the respective tax of the country of destination due to the import.

In contrast to customs duties, import tax is a transitory item for companies , as it can be claimed as input tax if certain conditions are met.

assessment basis

The import tax is calculated by the Federal Customs Administration (FCA) on the basis of the so-called fee or market value. The ancillary costs up to the destination are included, provided they are not already included in the payment or market value (packaging, insurance or transport costs, as well as costs for customs clearance, any customs duties or fees for permits, etc.). You can find the legal provisions on this in the Value Added Tax Act (MWSTG), Article 54

fee

If an item is imported as a result of a purchase, the import tax is based on the consideration. Anything that the recipient of the goods or their third party pays or has to pay for the items counts as payment. The fee also includes compensation for all costs, even if these are invoiced separately.

market value

If no fee is owed for the import of an item, the import tax is based on the market value. The market value is what a third party would have to pay if they were to buy the item. The tax is calculated on the market value, for example, when importing free samples, gifts or free replacement deliveries.

supporting documents

The values stated in the customs declaration must be supported by the commercial invoice.

If there are doubts as to the correctness of the customs declaration or if information is missing, the FCA can estimate the tax assessment basis and determine it ex officio.

Values in foreign currencies

Values given in foreign currencies are converted into Swiss francs at the exchange rate quoted on the day before the customs declaration.

Deductibility of import sales tax as input tax

If an entrepreneur imports the items for his company from a third country into Switzerland, he can usually deduct the import tax incurred as input tax . The input tax deduction is applied for via the current VAT statement.

According to the current legal opinion, it is important that the entrepreneur has the power of disposal over the imported goods at the time the goods are released for free circulation . He is listed on the assessment decision as the importer of the goods . Only then is he entitled to claim the import tax as input tax. Persons are not entitled to deduct the import tax who are only involved in the import but have no power of disposal over the items, such as storekeepers, carriers, forwarding agents or subsequent customers.

The only prerequisite for the deduction of import tax as input tax is its occurrence, which is proven by means of the assessment decision . The actual payment is not relevant . Thus, an established import tax, which, however, has to be paid later, for example due to the use of a payment deferral, can still be claimed in the VAT return for the quarter in which it arises. Ideally, the entrepreneur can have the import tax reimbursed as input tax by the Federal Tax Administration (ESTV) before the payment has to be made to the FCA.

Unfortunately , it is not possible to offset the import tax against the input tax claim in Switzerland, as different authorities are responsible.

Practical note on import sales tax

It is recommended that you keep a separate account with a corresponding tax code in your company accounting for the import tax incurred in your company from goods imported into Switzerland.